About Me

greekdefaultwatch@gmail.com
Natural gas consultant by day, blogger on the Greek economy by night. Trained as an economist and political scientist. I believe in common sense and in data, and my aim is to offer insight written in language that is clear and convincing.

21 October 2005

The blind lead the blind

The latest project for the Hugo Chavez – Fidel Castro connection is to offer medical services to patients suffering from eye diseases. The Financial Times reports, “Under Operation Miracle, Cuban doctors are performing as many as 1,500 operations a day in 14 locations throughout Cuba … In a recent speech Mr Castro said that the practice could eventually benefit as many as 25,000 people a year from the Caribbean – as well as 100,000 from Cuba, a similar number from Venezuela, and 120,000 from South and Central American” (1).

This is Mr. Chavez’s dream of “21st century socialism,” whatever that means. My own feelings are two: surging oil prices generate plenty profits; in Saudi Arabia these profits often find their way to charities that support militant groups. To spend the surplus on the blind and suffering is surely a more worthwhile goal.

But to claim that what is at play here is “21st century socialism” would be just as silly as claiming that Saudi Arabia’s GDP per capita is the result of prudent monetary policies and Wahhabi ideology. The Arabs have learned the hard way that oil profits come and go. Because their regimes are more stable than those in Latin America, they make no pretenses that their wealth is found in their own policies.

Latin America is different, but the oil is the same. Sooner or later Mr. Chavez will have to practice “21st century socialism” with less money. And that time will be a hard landing for Latin America, precisely because of Mr. Chavez’s diplomacy that has spread the oil wealth to the whole region, thus ensuring one thing: that when prices fall, it will not be Venezuela alone that will be thrown into turmoil. Caracas will drag the region down with it.